Cibus, Inc. (CBUS) Earnings Call Transcript & Summary

Please hold, the session will start shortly. Hello, everybody, and thanks for joining the Cibus third quarter 2025 results conference call. Everyone attending will be muted for the duration. Following today's presentation, we will open the lines so you can ask questions. Just a reminder, this conference is being recorded today. Right now, I'll hand things over to Mr. Carlo Broos, Chief Financial Officer. Sir, the floor is yours.

Thanks for joining us, and good afternoon. We appreciate you making the time to be with us for the Cibus third quarter 2025 financial results and business update conference call and webcast. Here with me today are Peter Beetham, our Co-founder, Interim Chief Executive Officer, President and COO, along with Greg Gocal, Co-founder and Chief Scientific Officer. Ahead of getting started, I want to remind all of you that remarks delivered during this call and webcast — including any relating to future financial results, future operational goals, and industry prospects — constitute forward-looking statements and could be subject to various risks and uncertainties that might cause actual results to differ materially from what gets described on this call. For a list of associated risks, please refer to Cibus SEC filings. This conference call is being webcast. To help with your analysis of our business, the webcast link, together with our press release and corporate presentation, can be found on the investor relations section of cbus.com. With that, I'd now like to turn the call over to Peter.

Thank you, Carlo, and good afternoon to all of you. Over the last quarter, we've sharpened our attention even more on commercialization and production efforts. I genuinely view this company as a coiled spring, set to deliver gene-edited traits for many years ahead. I'm thrilled today to walk you through the considerable Commercialization momentum we've built since putting our streamlined strategic focus in place. The strides made within only the last few months confirm that choosing to concentrate on the closest-term, highest-value revenue possibilities was the right call. As we've said before, our main emphasis is on weed management traits — introducing herbicide-tolerant crops into new markets and giving farmers excellent choices — while simultaneously generating early revenue from our biofragrance business. The headway our gifted team has achieved inside this concentrated strategic framework is extraordinary, and in my view the results make the case on their own. What you'll hear from us today shows how determined we are to reach our commercial objectives. Back in July of this year, when we unveiled our streamlined focus, we promised you it would help lock in our route toward near-term revenue opportunities. I'm happy to tell you now that we are following through on that promise. Before getting into our results, let me pause to highlight some recent exciting news regarding our board. We bolstered the board through two appointments during this quarter; back in September, Kimberly Box joined us as a new board member. Kim delivers precisely the sort of leadership we require as we enter this commercialization phase. Her background runs deep in technology operations, strategic transformation, and taking innovation to scale in global markets. That experience came from executive positions held at Hewlett-Packard spanning more than 30 years. Only last week, we brought on Greg Wishner. Craig's substantial expertise as a well-recognized leader in regenerative and sustainable agriculture, which includes farmland investment management through his role as founder and managing partner of Farmland LP, offers valuable perspectives as we move forward toward commercialization. These two directors will be instrumental in backing our commercialization push and creating long-term value; so now, let me turn to the headline accomplishments for the quarter and year to date. To date, we have signed seven RISE customer agreements across the U.S. and Latin America, which now account for roughly 5 to 7 million addressable acres for our RISE Herbicide-Tolerant Traits, HT1 and HT3. Should they be fully developed, they represent a chance to secure more than $200 million in potential annual royalties. Widening our customer base — with added customers in Latin America — plus our recent positioning to enter the enormous Asian markets through India, highlight the commercial possibilities created by our technology and the value proposition we can offer seed companies around the globe. Now let me turn to our priority pipeline traits and programs. I'll start with an update on our RISE Herbicide-Tolerant Traits, HT1 and HT3. As I noted, these two traits still represent more than $200 million in potential annual royalty revenue across our initial target geographies. These characteristics are advancing as planned toward an intended first commercial release in Latin America, starting in 2027, with growth into the United States afterward in 2028, and Asia nearer to 2030. Each quarter brings us nearer to that crucial inflection point for revenue growth. Our commercialization achievements so far this year in RISE have been outstanding; that is particularly the case in Latin America, where five RISE customer agreements have now been signed. Markets in Latin America have traditionally gone without access to sophisticated weed management solutions in RISE, which is a transformative chance for Cibus to bring substantial value to farmers while constructing our commercial base before the targeted launches in the U.S. and Asia. Recent illustrations include the agreement we signed in August, widening our Latin American customer base via a partnership with Centro Internacional de Agricultura Tropical, or CIAT, which collaborates with the Latin American Fund for Irrigated Rice, or FLAR, and takes part in the Hybrid Rice Consortium for Latin America, HIAL. To cut through this tangle of acronyms, I want to stress that this significant collaboration gives us the chance to make our HT traits available to RISE farmers throughout Latin America. FLAR will be an excellent partner and possesses an excellent trait record that includes introducing RISE varieties in 17 countries. Additionally, we signed a collaboration agreement in August with Semiano, and then more recently with Semilla del Huila. Both are significant Colombian RISE seed companies, indicating ongoing momentum in this strategically vital geography. As recently as last month in October, we started collaborating with strategic growth advisory firm AgVia to craft a comprehensive strategy for establishing CBUS access to seed companies in India; this is extremely exciting since India is the world's second-largest rice producer and the world's largest exporter, with roughly 120 million acres under cultivation. This collaboration will concentrate on facilitating joint development and commercialization relationships for advanced herbicide and sustainability traits, opening opportunities for Indian RISE seed companies and public agencies to incorporate our cutting-edge gene-editing solutions. When you step back and consider what we've achieved just in 2025, the commercial traction cannot be denied. We've grown our RISE program into a global platform reaching three continents and aiming at the world's most vital rice-growing regions. We've established relationships with both large multinational seed companies and regional leaders, and we're on track to start our first field validation trials in Latin America by year-end, with delivery of initial CBUS HT traits to our Latin American customers expected in Q4 2025. What's driving our customer momentum is our standardized rapid trait development system, or RTDS, which lets us edit customers' Elite Germplasm and return it with specific traits in roughly 12 to 15 months. RTDS is a fundamental breakthrough in agricultural innovation, giving the industry a dependable, time-bound model for trait development through gene editing that seed companies have never had before. Now, RTDS is gaining recognition as an essential extension of seed company breeding programs, and that recognition is converting into growing commercial partnerships. Now I want to provide an update on the sustainable ingredients initiative that our partners fund and support. I'm happy to report that during this quarter we hit important milestones, having successfully finished pre-commercial pilot runs for 2 biofragrance products, which confirms our technology can now move to full commercial scale; because of this, we were positioned to get initial payments that offset related R&D expenses in Q4 2025, marking the first proceeds we've received from this program. For our whole team, who have worked without letup, this is a huge milestone; it's one more factor backing our belief that this business is a coiled spring with tremendous promise. From this point, we're set up for focused expansion across 2026 while we move our RISE traits toward full commercialization over the following years — 2027, 2028, and beyond. Our biofragrance program shows how versatile our capabilities are in generating value past crop productivity traits; within the consumer packaged goods industry, we're seeing robust interest in bio-based fragrance products capable of replacing costly natural extraction processes or synthetic alternatives that are less preferred. In our view, the long-term opportunity here is enormous. Let me turn next to regulatory, which we see as a major catalyst for speeding up worldwide growth of gene-edited products and which keeps getting better. The EU regulatory process for new genomic techniques is still active and headed toward completion. Agreement has been reached on key legislative language, with final texts being polished across the remaining amendment categories and expected to be settled in the next few months. Outside Europe, our positive determination in Ecuador, continuing approvals throughout North and South America, plus advancing regulatory clarity in India and parts of Asia, are building a foundation for global market access. The California RISE Commission's approval of our field research proposal is the first instance gene-edited rice has been cleared for planting in California, one more important validation that our technology is working in tandem with the wider regulatory landscape. Briefly on operational progress, we've moved substantially forward on our pledge to disciplined capital allocation. During Q3, we finished folding our Oberlin, California facility into our San Diego location; these steps, along with others, are pushing us toward our goal of roughly $30 million in annual net cash usage for 2026; such capital discipline lengthens our runway while making sure we have the resources to seize the revenue opportunities in front of us; we keep directing resources to our highest value programs while sustaining the development momentum needed to reach our commercialization targets; with that, I'll hand the call to Greg so he can discuss our opportunity pipeline traits and programs. Greg.

Thanks, Peter. I'll keep my comments centered on the main technical achievements from this quarter — the ones that underpin both our priority programs and our wider pipeline of opportunities. On the RISE platform, I'd stress that the better editing efficiency we've reached is what directly makes the customer growth Peter talked about possible. We aren't just putting agreements in place; we genuinely are handing edited Elite Germplasm back to customers on schedules they can count on. That technical delivery is behind the partner interest we're seeing, and it confirms our industrialized breeding model works. With our RTDS, we're reshaping how plant breeders view the future of trait development. The unmatched pace of our technologies for editing elite genetics will only speed up as we keep improving and make strategic use of AI/ML technologies. Now a quick look at our opportunity pipeline, where I want to point out two important technical validations from this quarter. First, in our North American field trials, our HT2 herbicide-tolerance trait confirms the path for developing not just for that chemistry, but for any chemistry within this family. On sclerotinia resistance in canola, bioassays of plants carrying two of our modes of action show enhanced resistance; keep in mind that both HT2 and sclerotinia resistance hold broader potential use in crops such as soybean. On top of that, these results put both traits in a strong position for potential partner development. Our HT2 trait is now being offered to seed licensing partners as a funded continued development opportunity. Second, we finished year two of field trials for our pod shatter reduction trait in winter oilseed rape, with promising performance across several customers' Elite Germplasm; for the 2026 field season, we're glad to see U.K. legislation implemented that lets our gene-edited trait germplasm be grown the same way as conventional germplasm, while we pursue funded partnerships for continued development. Lastly, the soybean platform keeps drawing partnership interest as we work to tap a 125 million acre opportunity. The main point I want to leave with you is this: our RTDS platform keeps proving its worth across many crops and ever more complex traits. Whether that's delivering RISE traits to seven different customers, scaling up biofragrance production, or validating next-generation herbicide tolerance traits in canola, we're showing the versatility and commercial promise of our technologies. This technical base, together with our expanding regulatory track record, puts us in an exceptionally strong position to move high-value traits forward through partnerships while staying focused on executing against our priority revenue drivers. With that, I'll turn the call over to Carlo for a financial update. Carlo.

Thank you, Greg. Now for the financial results from our third quarter: on September 30, 2025, we held $23.9 million in cash and cash equivalents, a figure that reflects savings we've already realized from initiatives to reduce costs. Unless potential financing transactions that CBUS is pursuing have some effect, we expect the cash and cash equivalents we currently have to be sufficient to fund our planned operating expenses and capital expenditure requirements through early in the second quarter of 2026. I want to note that because we've concentrated on commercialization, we've been able to make both our expenses and our operations considerably leaner. In SG&A and R&D combined, we reduced operating expenses by close to $5 million over the first nine months of 2025. Turning to how we performed operationally in the third quarter: we brought in $615,000 of revenue, compared with $1.7 million during the same quarter last year. That drop is a reflection of when partner-funded program activities happened. R&D expense for Q3 totaled $10.8 million, versus $13 million a year earlier. The $2.2 million reduction comes largely from the cost-reduction initiatives we've put in place as part of focusing our operations more tightly. SG&A expense for Q3 reached $5.2 million, compared with $7.7 million in the year-ago period. That $2.5 million decrease is mostly due to cost-reduction initiatives. During the third quarter, interest expense tied to the royalty liability came to $9 million, matching what we recorded in the same period a year earlier, as we recognized both interest expense and the royalty liability. Net non-operating income for Q3 was minimal, compared with $7.7 million of income in the prior-year quarter. The decline stems from the fair value adjustment on the company's liability classified common warrants in 2024. We posted a net loss of $24.3 million in Q3, against $201.5 million in the year-ago period. That large improvement year over year is attributable to the $181.4 million non-cash goodwill impairment charge we booked in Q3 2024. As Peter noted, we finished consolidating our Oberlin facility in Q3 2025, and consolidation of our Roseville facility is still progressing as planned. Along with the workforce cut we finished in July, these steps demonstrate real movement toward our target of bringing yearly net cash use down to roughly $30 million by 2026. Being strict this way about how we deploy capital lengthens the time our cash can carry us and puts us in position to seize the sizable revenue chance in front of us, with the first revenues starting in 2026 followed by substantial commercial growth after that. That wraps the financial picture, so I'll hand things back to Peter for his closing comments.

Appreciate that, Carlo. Let me wrap up with the main point I'd like you to carry away from today's call. Agriculture's gene-editing revolution isn't off in the future — it's underway right now, and CBUS sits poised, much like a compressed spring, right at the leading edge of that shift. As I've said before, the genetics behind crop seeds form the powerhouse driving global food and feed output. Our decision to put RISE first is thrilling — not just because it could mean an exceptionally big yearly royalty stream for shareholders, but also because it delivers a sorely needed step forward in boosting yields for a staple crop that feeds billions. Consider everything we've already pulled off in 2025 alone: 7 RISE customer agreements across 3 continents, a successful biofragrance scalar alongside an initial payment for our pre-commercial product, plus what we see as a clear route to roughly $200 million in possible yearly royalty revenue from RISE traits by themselves. The commercial momentum is real and measurable. Traits of ours are entering customer germplasm, and field trial results keep coming back positive. The worldwide regulatory climate keeps growing more favorable, and we have commercial launches starting in 2027, with first revenues arriving in 2026 via biofragrances. This is no far-off dream; it's the concrete reality of the commercial chance right in front of us. Our sharper business focus is paying off. We stay intently committed to delivering on our RISE commercialization schedule, growing our sustainable ingredients revenues, and laying the groundwork for durable cash flow generation; we're showing disciplined capital management, lengthening our runway, and setting CBUS up to seize substantial value as gene editing turns into one of the benchmarks for agricultural innovation. Thank you for your backing, and we can't wait to update you on our further progress next quarter. Operator, we're ready for questions now. Thanks for the question, Kevin. This is Peter. I'll begin answering this one, then pass it over quickly to Greg, since I think there are some fantastic opportunities in this area. The main takeaway here, as I just noted in my closing remarks, is that gene editing is happening now. It's not a matter of the technology maturing; it has already matured. What we're discovering now is that the true catalyst for reaching commercial products is regulatory, with favorable regulatory tailwinds. We're fielding substantial inbound interest around partnerships that go beyond our present focus — RISE, canola, and soybean, along with our productivity traits. I think 2026 holds meaningful opportunity to broaden some of our R&D collaborations. Greg?

Yeah, thank you, Peter. As Peter mentioned, I believe there's a great deal of opportunity here. That opportunity exists not just in the platforms we're concentrating on right now, but far beyond them as well. I think we've created a genuinely distinctive method in this industry: we begin with individual cells that we modify, then regenerate complete plants. We possess that ability across a wide range of crops, and over the years we've built numerous platforms. On top of that, we have several traits we feel are ready for development — for example, our HT2 trait, plus different modes of action for sclerotinia resistance, which look very promising in controlled environments, and we're in the process of validating those in the field. Thank you for the question, Kevin. Sure. Got it. Thank you. For my second question, I suppose — I read what you wrote regarding the EU regulations, and I was just — clearly we're nearing the end here, but movement has been somewhat slower than initially anticipated. I was curious what your views are on roughly when you expect that to be finalized at last.

Appreciate that, Kevin. Peter here. I'm glad you see it as somewhat slower, since those of us in the industry have watched the past 12 months move faster than we'd anticipated. It's thrilling for us that Europe, across a span of more than 20 years, has resisted figuring out how to secure regulatory approval for genetically modified organisms. What has us energized on the gene editing side, which is a separate matter, is that starting in 2018, a serious push began to advance legislation. That legislation got voted on in 2024, and 2025 has been the year spent hammering out the final text. Drawing on what we know via European industry groups, plus a few of our seed company partners, we think they'll wrap up that text by the close of the year; once finalized, it will kick off implementation throughout Europe; that's a genuinely thrilling milestone, for our company and for the entire industry. Okay. Thanks so much.

Peter, could you give me a few seconds to jump in? Sorry, Kevin — Carlo here. Since I'm based in Europe, these kinds of questions are always a pleasure for me, naturally. This time I wasn't present at Euroseeds, though several of our colleagues attended, and it was really quite impressive. It seems nearly every seed company was coming to the realization that gene editing along with new breeding technologies is on its way. At Euroseeds this year, only a few months back, I believe that was the number one theme; it leaves me extremely excited when I consider what this is going to mean for us. Thank you.

Hey, everyone. I appreciate you taking my questions. To start, regarding the key RISE markets where you'll be selling — Latin America, the U.S., and India — how should we think about the acres you can reach, the total addressable market, and what exactly goes into calculating that total addressable market for these regions?

Matt, thanks for asking; it's Peter here. Yeah, we're really thrilled about the AgVia partnership. This is a team, I'd say, with many years of leadership experience at big multinationals and in developing seed and trait operations in India. We've been quite lucky to collaborate with them in thoroughly charting our opportunity there. Rice covers more than 120 million acres in India. It ranks as the world's second biggest rice exporter; we think this is a market we can reach via this kind of partnership with AgVia. Once again, our aim here is to establish ties with seed companies, supply material, and return it to them, so we can commercialize around 2030, 2032. As you know, we earn royalties, so our projected trait fees for this should match what we've observed and discussed in Asia — potentially $1-$2 per acre, or somewhat higher. That's great for us, since I believe there's a chance to significantly grow that. I'll pass it over to Greg, because he just got back from India, where he spoke with several seed companies.

Yes. Matt, I'm genuinely, genuinely thrilled about what — I mean, we're at the start of a journey involving seed companies in India, collaborating with AgVia, which is assisting us with those connections and helping us build our footprint in India. There's enormous demand for rice, and also enormous demand for possibly other crops in that country. In certain regions of India, you're rotating rice two times per year, so it turns into something like some of the markets in Latin America. Great question. Yes. Thank you, Matt.

Thanks, guys. Yeah. When it comes to Latin America and the U.S., what number of acres can be reached via the customers you currently have for RISE?

Matt, I appreciate you asking that. Like we said during our remarks, during this most recent quarter, we brought on a few more seed companies located in Latin America. The total now stands at 7, with 2 based in the U.S.; and 5 at this point in Latin America. That gives us the ability to genuinely serve that market. What we're telling you at this moment is somewhere between 5 to 7 million, meaning we've added a couple of million acres compared to what we had in Latin America during the prior quarter. That brings us, once again, past this goal and objective of $200 million in annual royalties.

Understood. And finally from my side, clearly, lowering canola pod shatter, that wasn't a trait that worked out immediately in the manner you'd anticipated. What makes HT traits distinct from PSR, and what makes them simpler to slot into breeding efforts for seed distributors and seed companies?

Thank you, Matt. That's an excellent question. What we've understood across this industry for a lot of years is that weed control or herbicide-tolerant traits are essentially akin to the operating system for a lot of crops. Each year when a farmer puts seed in the ground, they must manage their weeds, and they use either selective herbicides or non-selective herbicides. What's really widely recognized at this point is that this business model is very well comprehended. Actually, within the GMO portion of the business, they continue to gather roughly $4 billion in yearly royalties on a trait that came about during the 1990s. What we can do is deliver novel traits into the market so farmers get options for controlling their weeds. My view is that herbicide tolerance or weed management solutions gain a great deal of traction fast in the market. That's among the reasons we are enrolling a number of companies across both the U.S. and Latin America. As we stated during our remarks, HT2, a further herbicide-tolerant trait, we enjoyed excellent field trials this year; we shared those results early, and that's in canola, and that's in North America. They serve as a foundation for planting crops, and I think that trait spans not just multiple geographies, but multiple crops. Somewhat unlike pod shatter, since pod shatter reduction is more limited to smaller geographies. The possibility we're now exploring is additional territory in the U.K. and Europe for our pod shatter trait in 2028.

Building on what Peter said regarding weed management, control systems for weeds essentially function as an operating system for those who farm. In developed agriculture, there's an assumption that a weed control package exists to make cultivation possible, even across smaller acreages — for instance, in Latin America and India. Water, nutrients, and sunlight get pulled away from crops by weeds, which lowers yield. Now, we aren't a chemistry company, yet throughout our history we've managed to create gene-edited weed control solutions covering at least 4 groups of chemistry, and my belief is that even greater potential lies beyond that; where we stand excites us, and we're confident there's substantial value for seed companies, growers, and our shareholders alike in the weed control traits currently under development. Thanks, guys. I appreciate you taking my questions. I'll jump back into the queue.

Thanks, Matt.

Hi there, good afternoon, and I appreciate you fielding my question. It's encouraging to observe that Biofragrances have begun to see some initial commercialization. For 2026, ought we to anticipate a rapid scale-up on this front, reaching double-digit millions, or instead expect revenues in the single-digit millions for that year?

Thanks, Samir. Peter here. I truly appreciate you asking that. Regarding Bio-fragrance, we're eager to go through our pre-commercialization scale-up during this year, and it has gone extremely well. We perceive opportunities extending past the two fragrances we've already scaled. A ramp-up is something we foresee in 2026. In our view, the overall opportunity sits within a revenue range of $20 million-$40 million, though in the early stages, that figure will land in the single-digit millions. To our minds, this is merely the tip of the iceberg. The fragrance market exceeds $65 billion, and this space is seeking alternatives, especially when it comes to natural fragrances available today. I believe there's an opportunity that might grow past that.